Chapter 8: Game Peripherals Are the Most Profitable
After selling 150,000 copies, William had stopped reproducing the game discs. The official price of six pounds was cheap, and many of the student sellers were marking them up to over ten pounds each. This was earning him hundreds of thousands of pounds, but the method wasn't sustainable. The most important thing now was to leverage the game's popularity.
The massive sales volume in London and the resulting praise were bound to attract major players: the game companies EA and Ubisoft, distributors and supermarkets, and even Best Buy in the United States, which specialized in DVDs and computer games. He considered the money he had already spent paying the student sellers as an advertising fee to attract these large companies.
A few days ago, after receiving inquiries from these companies about either distributing or buying the game, William had gone to one of the top barrister firms in London. He hired Anthony, a senior partner at the Yuelida Law Firm, for one thousand pounds an hour. He knew these negotiations could take days, if not longer, and that he would have to pay tens of thousands of pounds in legal fees. Fortunately, he had signed a contract with the firm based on billable hours.
He booked a conference room at the London Hilton and met Anthony from the Yuelida Law Firm there at eight o'clock in the morning.
After they met, William shook Anthony's hand and asked with a smile, "Good morning, Mr. Anthony. It's eight o'clock now. Has the billing started?"
Anthony knew William was joking. "Good morning, Mr. Devonshire. If starting the clock in ten minutes would make you happy, then we will begin billing at 8:10. I don't mind."
"Haha, Anthony, you have a good sense of humor. But let's get down to business. I need you to handle all the legal matters, correct?"
"Of course, no problem, Mr. Devonshire. This is what we do. I promise that any contract our firm scrutinizes will be airtight. That is our guarantee and commitment."
William nodded in agreement. This was exactly why he had hired a lawyer from Yuelida.
"Okay, I trust you completely. As one of the top three law firms in England, your firm's strength and reputation are beyond question. Well then, Anthony, let's begin. Today is going to be very busy."
After speaking, he shook hands and exchanged greetings with the four members of Anthony's team. For one thousand pounds an hour, he could hire one of the best lawyers in London and his team. William didn't feel it was expensive at all. If he hired a lawyer who wasn't professional enough, he wouldn't even have a chance to cry over his losses later. Of course, only barristers earned this kind of money; a regular solicitor might only make a few thousand pounds a month.
At nine o'clock, the representatives from several large companies began to arrive: EA, Ubisoft, Best Buy, Carrefour, and other game distributors.
After everyone had found their seats, William got straight to the point. Everything depended on the quality and sales of the game, and the potential profit. No matter how good his pitch was, these companies wouldn't be interested without solid numbers.
William took a microphone and stepped onto the small stage at the front of the conference room. "Welcome, gentlemen. My name is William Devonshire, the producer, designer, and owner of *Plants vs. Zombies*."
"Time is precious, so I'll be direct. Many of your companies have contacted me over the past few days. Is that correct?"
The negotiators from the various companies nodded but didn't say much. They had all sent people to contact William, but he had never given any hints about his intentions. Although they were optimistic about the game, none of them wanted to be the first to make an offer.
"Alright then, gentlemen. I'll start by stating the bottom line I can accept. If there's a large gap between my numbers and yours, or if you're dissatisfied, please hold your comments and hear me out first. Okay?"
Everyone glanced at each other. They were all competitors. The fact that all these companies had come to this conference only a short time after the game became known proved they were all very optimistic about its potential. Before a price was named, no one wanted to speak up. William's request to be heard out wasn't unreasonable, so they all nodded again.
"Thank you," William said with a nod. "Let's talk about distribution rights first."
"The distribution price I can accept is eight pounds per game disc. Eight pounds is almost thirteen US dollars. I think there should be no problem selling *Plants vs. Zombies* for twenty US dollars in the United States. And you all must know that in the late 1980s, the wholesale price of a new game was around twenty-five dollars. You are all experts in the game industry. You know I'm right, and that a price of eight pounds is not unreasonable."
"If you can accept eight pounds, then we can continue this conversation."
EA and Ubisoft had never intended to just be distributors, but they were afraid the other companies would try to lowball the distribution price. If that happened, William might not sell the game at all, and their trip would be for nothing. So, they quickly nodded. "Eight pounds is acceptable."
The distributors thought about it. They all knew William was right that the game would sell for at least twenty dollars in the United States. However, watching the big game companies agree so quickly, they cursed internally. *These guys should go to hell. Their own games are so expensive, and now they're trying to horn in on distribution deals.* Best Buy and the other distributors nodded to accept the price.
"Very good. If everyone can accept the price of eight pounds, then we have a basis to continue the discussion. I have the data on the 150,000 game discs sold in London in one month. I won't bother handing it out; I'm sure you've all done your own market research."
"That's why we're all sitting here together. Now, for my second point, which you may not know, but I think the representatives from Carrefour will."
William paused and looked at the representative from Carrefour, who nodded with a knowing smile.
"Twenty days ago, I signed a licensing contract with Carrefour for merchandise such as T-shirts and hats. Now I think I signed it too early."
"But it doesn't matter. I still want to thank Carrefour. This contract authorizes Carrefour to produce merchandise based on the cartoon characters from *Plants vs. Zombies* in the five counties surrounding London."
"In the fifteen days from the start of sales until yesterday, the sales data for these peripheral products in 120 London supermarkets was 430,000 items sold. That's an average of 3,600 items per store in fifteen days, or 240 items per store per day. The total turnover was 6.45 million pounds, with an average price of fifteen pounds per item."
Except for the people from Carrefour, everyone else in the conference room was hearing this data for the first time.
Hearing that peripherals had generated 6.45 million pounds in sales in just five London counties over fifteen days, they all got excited. If the game went global, how much could the merchandise sell for worldwide?
Peripherals were the real money-maker. Europe and the United States were very strict with copyright enforcement, and a lawsuit involving such a clear-cut copyright would be a guaranteed win.
After everyone quieted down, William continued, "I don't think it's an exaggeration to say the game will sell one million copies in Europe. I even think that after a year or two, once its popularity peaks, selling over three million copies won't be difficult."
The distributors in the room didn't look happy. They didn't think he was exaggerating. Some of their own company estimates were even higher, if only by a few hundred thousand copies. It was only the year 2000. While there were many good games, there was nothing quite like *Plants vs. Zombies*. It was a game that appealed to everyone, from the elderly to children to adults. William knew that thirteen years in the future, the game would exceed 25 million downloads.
William continued, "In the United States, selling two million copies will not be a problem. Other countries combined could add another two million copies."
"Gentlemen, please think about how much wealth a game that can sell more than seven million copies, plus its peripherals, can create for you."
"FUCK," everyone cursed in their hearts. "It's creating wealth for *you*."
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